Bitcoin Flash Crash Sparks Debate: Is $70K or $88K Next?
Bitcoin's blistering weekly rally hit a speed bump early Saturday, August 22. Shortly after 04:00 UTC, BTC slid sharply from roughly $79,500 to a low near $76,300 in what traders are calling a flash crash. The move triggered a wave of forced selling, with 24-hour liquidations across the crypto market reaching an estimated $1.8 billion and affecting more than 286,000 traders, according to on-chain data trackers. The single largest forced liquidation was a roughly $25 million BTC position on the derivatives platform Hyperliquid. Ethereum and XRP were caught in the same downdraft, with ETH losing close to $293 million in liquidated long positions and XRP briefly dropping more than 10% before stabilizing.
Analysts Are Split: A Retest of $70K or a Run Toward $88K?
The crash came just as Bitcoin's momentum indicators flashed a warning. On the four-hour chart, the Relative Strength Index (RSI) climbed to its highest reading in more than seven years — well above the level of 70 that traders typically consider overbought. Historically, such extreme readings have preceded short-term pullbacks or periods of consolidation, though they don't necessarily end an uptrend on their own.
That has left analysts divided into two camps. Some believe that if Bitcoin holds support in the $75,000–$76,000 range, the rally could resume toward $83,000–$88,000. Others argue that fading momentum and elevated funding rates point to a deeper correction toward $70,000–$72,000. Notably, U.S. spot Bitcoin ETFs still logged roughly $307 million in net inflows the day before the crash, a sign that institutional demand hasn't disappeared even as short-term traders got shaken out.
The Bigger Picture: Dollar Weakness Fuels a Hard-Asset Rally
Zooming out, Bitcoin's swings are unfolding against a broader macro backdrop that's drawing comparisons to gold and silver, both of which also rallied this week. Galaxy Digital's Alex Thorn, the firm's head of research, and analyst Beimnet Abebe argue that the U.S. Federal Reserve's expanding balance sheet, combined with the Treasury's buybacks of longer-dated debt and reissuance at the short end, is functioning like a form of quantitative easing. That kind of balance-sheet activity, they say, tends to weaken the dollar — and the U.S. Dollar Index has in fact slipped below its 200-day moving average for the first time in months. Gold gained close to 3.7% and silver about 3.9% on the same day the dollar fell roughly 0.8%, even as the Nasdaq stayed essentially flat — a pattern Thorn described as a hard-asset rally that now includes Bitcoin.
Galaxy Digital: The Cycle Bottom May Already Be In
Perhaps the more consequential call is Galaxy's read on Bitcoin's four-year cycle. Thorn and Abebe believe the cycle low is likely already behind us, arriving somewhat earlier than the September–October window that past cycles would suggest. They point to a shift in market behavior from a "sell the rally" mindset to a "buy the dip" one, and note that the largest concentration of Bitcoin's cost basis — where the most coins last changed hands — now sits around $64,000, a level they view as a strong underlying support zone. Galaxy's base-case target is $80,000, with the firm describing the risks to that forecast as skewed to the upside.
What It Means for U.S. Investors
Retail sentiment reflects that same optimism. In a recent Stocktwits poll, roughly 70% of respondents expected Bitcoin to reach $80,000 or higher, with nearly half betting on a run past $100,000. Still, the events of the past 48 hours are a reminder that even in a bullish structural setup, leverage-driven volatility can produce sharp, fast moves in either direction. For now, the market sits at a genuine decision point: whether Saturday's flash crash was a healthy reset within an ongoing rally, or the first sign of a deeper pullback following one of Bitcoin's most overbought technical readings in years.
